The fact that Schmidt's package vests over four years and that it's the first time Google has given this type of an award to Schmidt, who's been a successful CEO there since 2001, makes this situation seem more ordinary. Perhaps a golden parachute? There's little precedent for this approach; CEO's typically leave when the stock and profits are down or when they have been accused of something nasty. In this instance, however, the CEO seems to be leaving while doing an excellent job. Besides, the fact that it's unvested stock and options means the package may be worth little if Google doesn't continue to do well, thereby giving Schmidt an incentive to be a really aggressive executive chairman.
$100 Million Award To Outgoing Google CEO Not Surprising At All
When Google this weekend confirmed that the search giant—whose algorithms control a stunningly high percentage of E-Commerce sales—was giving a $100 million equity award to CEO-For-The-Moment Eric Schmidt, some thought the move unusual. After all, these unvested packages of stock and stock options typically go to new CEOs as part of a recruitment package. In Schmidt's case, though, Google just announced that he will be replaced as CEO in April by co-founder Larry Page. (Schmidt will become executive chairman, presumably also acting as the head of the search committee to find the next CEO.)